Distribution Channels: Pharmaceuticals

| 2 minutes

As pharmaceuticals are heavily regulated, requiring a prescription by a doctor or pharmacist, the channels through which pharmaceuticals are administered to patients are limited mostly to hospitals, clinics and pharmacies.

Types of Pharmaceuticals

In general terms, and relative to AdvaCare’s pharmaceutical range, our pharmaceutical products can be divided into the following 2 broad categories:

1. Prescription medicines (Rx):

Various therapies of medicines available in 12 different dosage forms that are prescribed by a doctor or pharmacist.

2. Over-the-Counter medicines (OTC):

Medicines that are classified as pharmaceuticals, but do not require a prescription by a doctor or pharmacist. These medicines can be purchased by consumers in pharmacies, stores or online.

What is Product Registration?

In most countries, it is required that a pharmaceutical product, and sometimes the manufacturing facility as well, must be “registered”. This is often a lengthy process, which can take between 6 months to 2 years depending on the country, in which AdvaCare has to submit a compilation of many various technical documents, called a dossier, along with product samples, to the local health authority (FDA, Ministry of Health or other name of the national agency for drug enforcement).

Once the process is completed, the distributor can import our registered pharmaceutical products, and start to distribute through various channels. The distribution channels through which pharmaceutical products get from AdvaCare to the patient or end consumer can vary.

Advantages vs. Disadvantages

Before getting started with the details of our Distribution Channels, it is important to understand the competitive advantages and disadvantages of our pharmaceutical product range:

PHARMACEUTICALS
ADVANTAGES
 		DISADVANTAGES
  • USA brand with competitive price points.
  • Manufacturers cannot produce such a wide scope of dosage forms, usually 5-6 forms at most because each form requires a production line. AdvaCare has ~500 pharmaceutical products in 13 dosage forms.
  • Manufacturers are restricted to countries for which they have sufficient certifications to meet regulatory requirements. AdvaCare has a wide network of manufacturers to match certifications to country requirements.
  • CMOs (Contract Manufacturing Organizations) are not organized or have sufficient infrastructure to undertake the complexity of coordinating hundreds of data points: products, countries, certifications, etc. AdvaCare is well organized with substantial infrastructure.
  • CMOs lack in-house regulatory capability. AdvaCare has a dedicated Regulatory Affairs Dept.
  • China and India-based manufacturers are respectively limited to the products which they are strong for production - China is stronger with more simple molecules in large quantities, India is stronger with more complex molecules in smaller quantities. AdvaCare can leverage both China and India.
  • Some distributors only want to work directly with manufacturers because they perceive prices to be more competitive. However, AdvaCare has a wide manufacturing network to leverage lower cost options.
  • Some distributors want to work directly with manufacturers because they perceive decreased risk with quality control as another party in between manufacturing and the distributor can create more barriers for reimbursement.
  • Some distributors want to work directly with manufacturers because they perceive product registration to be more direct without the involvement of a third party in between the manufacturer and distributor.
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